What is Lease Option (Rent-to-Own)?
A lease option is a rental agreement combined with the right to purchase the property at a predetermined price within a set timeframe. The tenant pays an upfront option fee and receives rent credits — a portion of monthly rent applied toward the purchase price.
Formula
Effective Price = Purchase Price - Option Fee - Total Rent Credits
Good
Rent credits of 10-20% of monthly rent
Great
Building $10K+ in equity through credits before exercising
Watch For
Losing the option fee and credits if you choose not to buy
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